The history of exploration operations in the Central Alborz area, which
embodies more than 30,000 square kilometers of Mazandaran Province, dates
back to about 83 years ago.

The first exploration operations in that vast area took place under the
water in 1314 (1935/36) during the nationwide railroad construction which
led to the exploitation of Kanij Kola Mine and subsequently another
exploration operation was conducted in the same area which eventually in
1350 (1971/72), resulted in the exploitation of some part of the Kar Mozd
Mine in the same area. Therefore, mines of the Central Alborz Coal Company
could be considered the oldest coal mines in Iran. On the other hand, the
Central Alborz Coal Company, in line with the government’s policy of
privatization, has ceded most of its operating mines to the private sector.

2- Status Quo

Currently the company holds exploitation permit for Kordabad Mine with a
definite reserve of 21.6 million tons and possible reserves of 40 million
tons. The region has been divided into two parts.

2-1. Kari Kola area: By obtaining a permit from the Environment and Natural
Resources Department, tunnel digging operations are underway for
complementary explorations and exploitation in coming years.

2-2. Jamshidabad area: Action has been taken to receive a permit from the
Environment and Natural Resources Department so that by obtaining a permit
to launch mining operations in coming years.

2-3. Exploitation permit for Goliran Mine: With a definite reserve of 27
million tons and possible reserves of 14 million tons, the capacity of the
mine in block 6 is currently equal to 60,000 tons per year. With the launch
of block 9 some 150,000 tons of coal will be also extracted from this block.

2-4. Gardaneh Sar and Sefid Riz exploration area: The reserve of the area is
over 10 million tons which, with the completion of the exploration
operation, steps are being taken to receive a discovery certificate.

2-5. New coal washing plant in Anjir Tangeh region: It became operational in
1396 (2017) with a nominal capacity of 500,000 tons of raw coal per year and
production of 350,000 tons of concentrate.

2-6. Old coal washing plant: It became operational in 1367 (1988) and has
remained unused due to the commissioning of the new plant and has been put
at the disposal of a contractor to process 2 million tons of the present
wastes in Anjir Tangeh enclosure with the capacity of washing 150,000 tons
annually and dispose the wastes remaining from the processing out of the
plant area.

2-7. Charcoal laboratory in Anjir Tangeh region: For the analysis of the
purchased raw coal and the produced coal concentrate.

2-8. The company has an administrative site located in Azadmehr region and
an educational-cultural complex in Khazarabad. The complex is open for the
use of the company staff and other partner units in all seasons.

3- Company Products

At present, the company produces coal concentrate with the following
qualitative specifications after washing the raw coal at the coal washing
plant:

Ash - 10.5 to 11 percent

Volatile materials - 34 percent

Plastometry - 15 mm

Sulfur – 1 percent

Moisture - 10 to 11 percent

4- Selling Process

The company supplies part of the raw coking coal needed by the coal washing
plant from its mines and purchases the remaining raw coal from the private
sector in the region and other parts of the country. After processing in the
coal washing plant and transferring it into the coking coal concentrate it
is transported by the railway and truck to Esfahan Steel Company and by
truck to Zarand Coke Making Complex in Kerman. The current concentrate
production program of the company is 120 thousand tons per year.

5- Investment Plans and Attraction of Foreign Investors

1- Plan to build Savadkouh coke factory

2- Plan to prepare and equip Kordabad Mine

3- Plan to prepare and equip Goliran Mine

5-1. Plan to build Savadkouh Coke factory

The plan for building Savadkouh coke factory with an annual production
capacity of 300,000 tons of coke in Anjir Tangeh region in a period of 36
months has the joint cooperation of the Kani Kavan Shargh Co. and the CMC of
China as the contractor and is in the final stages of receiving the
environmental permit.

5-2. Plan to prepare and equip Kordabad Mine

The plan for the preparation and equipment of Kordabad Mine for the
production of 60,000 tons of raw coke per year is being followed up.
Consultant of the plan has prepared the final report of environmental
studies and submitted it to the provincial environmental department. After
approval it was sent to the Department of Environment and after receiving
the final permit, operations for the equipment and preparation of
Jamshidabad section of the mine will be launched. The definite reserve of
the mine is 21.6 million tons and its possible reserve is 40 million tons.
In this part the Kari Kola mine is currently undergoing complementary
exploration operations.

5-3. Plan to prepare and equip Goliran Mine

In this mine block 6 with a production capacity of 60,000 tons a year is
currently operational and block 9 with a production capacity of 150,000 tons
per year has been designed by Ukrainian consultants and if the funding is
provided it will become operational in a period of three years.

6. Environmental Measures

6-1. Construction of a barrier dam to prevent entry of waste into the river
adjacent to the site.

6-2. Active presence in international environmental exhibitions over the
past years and implementation of programs related to the maintenance of
sustainable development in the company.

6-3. In line with the improvement of environmental issues and increase of
the efficiency in Savadkouh coal washing factory, technical knowhow of the
creditable FLS Company has been used. Meanwhile, the company has supplied
the majority of foreign equipment. Installation of the equipment and hot and
cold commissioning of the plant has been done in the presence of the company
supervisors.